Ben Carson recently revealed his proposed policy for the American healthcare system. CarsonCare would repeal Obamacare and create a universal system of health savings accounts (HSAs). Tax dollars currently funding Medicare and Medicaid would be reallocated to the HSAs for lower-income Americans to subsidize the cost of care.
It is difficult to evaluate the effectiveness of this feature since Carson hasn’t specified how much money would be diverted or how many Americans would receive a subsidy. In interviews, Carson suggested $5,000 for 80 million Americans per year. Individuals and employers would be able to contribute additional dollars to HSAs tax-free. Individuals with HSAs would be able to share funds with their immediate and extended family members. In addition, individuals and families would have the opportunity to purchase health insurance for expenses above the amount set aside in their HSAs if they need catastrophic care. Carson would also preserve Medicare and Medicaid programs as options for those who want to keep them. CarsonCare would give people “the option of opting out” of government healthcare. However, without a requirement to purchase insurance or enroll in a government program, millions of Americans would be an accident or tragic diagnosis away from bills that would force them into bankruptcy.
The most obvious problem in CarsonCare is the idea that HSAs and catastrophic coverage would be affordable for the average American family. In 2015, the average annual premium for workers in HSA-qualified high-deductible health-care plans was $15,379 for a family plan. If more expensive Medicare patients were incorporated into that mix, the numbers would be higher. The notion that seniors and low-income working families would be able to afford more than $15,000 a year in premiums, plus high deductibles is completely unrealistic. Even if Carson could somehow take out more than $500 billion from Medicaid and Medicare to fund HSAs with $5,000 for 80 million lower-income Americans, most consumers would end up spending more for less than they got before.
CarsonCare is innovative in comparison to plans proposed by the current group of Republican presidential contenders. Further, over the past decade, enrollment in HSAs and high-deductible health plans has started to grow significantly. Today, 24% of American workers are enrolled in high-deductible health plans, which is more than a six fold increase from 2006. While spending is certainly reduced in HSAs, there would be sicker patients in the long run, resulting in even more costs to compensate the future need. In the end, CarsonCare seems to simply rearrange the money from one program to another and so Americans must continue waiting for a more viable solution to fixing their healthcare system.
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